Microsoft’s chief executive, Satya Nadella, saw a significant increase in his compensation last year, earning a staggering $79.1 million, a 63% rise from the previous year. This increase comes despite Nadella’s request to reduce one element of his pay package due to cybersecurity flaws at the tech giant, resulting in him receiving $5 million less than he could have.
In a proxy statement filed with the US financial regulator, Microsoft’s board highlighted the company’s impressive 16% revenue growth in the year leading up to June 30, 2024. Despite the company cutting thousands of jobs, including in its gaming division, Nadella’s compensation reflects the strong performance of the company.
The compensation committee acknowledged Nadella’s request to reduce his cash incentive, citing his personal accountability over a series of cyber attacks, including one in July 2023 where hackers gained access to the email accounts of numerous organizations, including government agencies. The attack, which Microsoft attributed to China, was met with denial from the Chinese embassy in London.
Nadella’s cash pay was reduced by more than half to $5.2 million, representing less than 7% of his total compensation, with the bulk of his earnings coming from stock options totaling $71.2 million. While some, like High Pay Centre director Luke Hildyard, question the necessity of such high earnings for executives, others argue that it reflects Microsoft’s strong financial performance.
Comparing Nadella’s earnings to other tech executives, Apple’s Tim Cook earned $63.2 million in 2023, Nvidia’s Jensen Huang received $34.2 million in the 2024 fiscal year, and Tesla’s Elon Musk’s pay packet could potentially reach up to $56 billion. The disparity in executive compensation raises questions about wealth distribution and the value placed on leadership in the tech industry.
